(Alliance News) - Xtract Resources PLC said on Wednesday that it has entered into a joint venture with Oval Mining Ltd who are acting in cooperation with mining consultant Cooperlemon Consultancy Ltd.

The Australian and Zambian-focused mining company is looking to acquire a 70% interest in the Silverking copper mine, and its accompanying licence, in Zambia's Mumbwa district.

Previous geochemical surveys undertaken by Glencore in 2012 identified a number of high priority copper targets which Xtract hopes to follow up on during proposed exploration work.

The joint venture agreement outlines that Xtract can earn a 51% interest in the licence in 18 months by spending USD500,000 on exploration. After this, the company can increase its stake to 70% by investing an additional USD1.0 million over two years.

If the reported copper exceeds 500,000 tonnes, proceeds will be shared equally between the partners. Cooperlemon will not be responsible for any exploration costs, but will be responsible for any costs incurred during the disposal process, including local taxes and legal fees.

If the project fails to support 300,000 tonnes or more then a small mining project may commence. Xtract would be responsible for funding the entire project and would not recover from Cooperlemon any share of costs.

Executive Chairman Colin Bird said: "This agreement is consistent with the company's stated mission of acquiring exploration resources which have significant copper showings, considerable upside potential and occur in proximity to current or potential mines. Silverking certainly satisfies all of the criteria, and we are excited about the prospects for a future discovery."

Xtract shares were up 22% to 1.01 pence each in London on Wednesday afternoon

By Elijah Dale, Alliance News reporter

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